The appellant No,2 a sole proprietorship of the appellant NO entered into agreement with the respondent for making a Film called " Zar Gul". The agreement included arbitration clause. Disputes arose between the parties and in the first instance were referred to two Arbitrators appointed by the parties respectively. The said Arbitrators failed to achieve an accord and they referred the matter to Mr. Justice (R) Shafi-ur-Rehman as an Umpire. The Umpire made and pullished. his award on 7-9-1994. On 23-11-1994 the respondent tiled an application under section 14 of the Arbitration Act. 1944 for a direction to the Umpir to file award in Court. A notice was accordingly issued to the Arbitrator and the award was tiled in Court some times before 13-12-1994. It was opened in the presence of the parties on 11-1-1995 and the case was adjourned for filing of objections. The objections were not filed by any of the parties. However, on 20-2-1995 an application was tiled by appellants under section 5 of the Limitation Act, 1908, for condoning the delay in the matter of, tiling of the objections which were stated to be contained in application under sections 30/33 of the said Act already tiled in Court: The learned trial Court vide order dated 3-7-1995 refused to condone the delay and also refused to set aside the said award pursuant to the said application under sections 30/33 of the said Act and consequently proceeded to make the award rule of the Court and a decree followed. In the same order a direction was issued to the respondent to pay stamp duty on the said award as prescribed in Article 12 of Schedule to Stamp Act, 1899 as amended by Punjab Finance Act, 1990.
2. Mr. Ali Sibtain Fazli, learned counsel for the appellants contends that the I award being unstamped was void and could not have been received and made rule of the Court: that the delay in filing of objections ought to have been condoned and in any case there was no delay inasmuch as the time prescribed in Article 158 of the Limitation Act, 1908 could have commenced only when the Umpire had filed the entire proceedings and deposition alongwith award which, according to the learned counsel, were not filed. Further contends that the learned trial Court in any event was bound even in the absence of objection to scrutinize the award to determine whether it needs to be remitted or set aside. Learned counsel then argues that Umpire had failed to take notice of the fact that delay in the completion of Film was primarily attributable to the delay on the part of the respondent to make contribution of capital in time. Further argues that interest on the invested amount and mark-up on the loan amount has been levied illegally.
3. Learned counsel for the respondent on the other hand supports the impugned order of the learned trial Court and endorses the contents of the award.
4. I have gone through the trial Court records, with the assistance of the learned counsel for the parties. As to the said first contention of the learned counsel for the appellants. I find that nothing turns on the same. It is true that the award when filed in Court was unstamped. However, it does not at all lead to the conclusion that it was void because of the said defect or for that matter even invalid. Mr. Ali Sibtain Fazli, in all fairness has himself cited the case of Union Insurance Company of Pakistan Ltd. v. Hafiz Muhammad Siddique (PLD 1978 SC 279). Mr. Justice Dorab Patel (as his lordship then was ) in his leading opinion recapitulated the entire history of section 35 of the Stamp Act, 1899, discussed in detail the various provisions of the said Act contained in Chapter-IV thereof and after taking into account the case law cited on the subject concluded that the instrument (Arbitration agreement in the said case) was not invalid even if it was unstamped and award based thereon cannot be avoided on the said ground. In the case of Mst. Farida Malik and others v.
Dr. Khalida Malik and others (1998 SCM R 816) again cited by Mr. Fazli, their lordships held that the fact that award was unstamped would not make award invalid within the meaning of section 30 of the Arbitration Act, 1944.
5. Learned counsel then contends that duty payable is 3% of the amount to which the award relates as set forth in such award whereas, the learned trial Court directed payment of duty @ Rs,2%. As noted by me above the award was made on 7-9-1994. At the said time under Article 12 the duty payable in respect of award was the same as payable on a Bond (Article 15) and under Article 15 the duty payable was payable @ Rs,20 per Rs,1,000 or 2%. I, therefore, hold that the award was got duly stamped by the learned trial Court. I may further note here that objections of the learned counsel is that apart from the duty learned trial Court ought to have levied penalty in sum equal to 10 times of the said duty. I am afraid, the document was not required to be admitted in evidence within the meaning of section 35 of the Stamp Act, 1899. It is only when a document is to be admitted in evidence and is unstamped or deficiently stamped that the payment of the duty together with the said penalty is to be directed. To my mind, regarding the other matters mentioned in said section 35 the only requirement is that the instrument is to be duly stamped. This has been done by the respondent in the present case.
6. As to the contention regarding matter of condonation of delay I find that the Umpire had filed the award alongwith proceedings undertaken by him. These also include award of the two Arbitrators.
Regarding the deposition it has been stated in the order sheet by the Umpire, and not questioned by the appellants, that the parties do not want to produce any evidence or record. It has already been noted above that envelope containing the award was opened in the presence of the parties and order dated 11-1-1995 clearly narrates that sealed envelop has been opened in the presence of the parties and the award alongwith deposition has been brought out. The said contention of the learned counsel consequently is not borne out from the record and I do not find error in the impugned order of the learned trial Court when he refused to condone the delay in the filing of the objections.
7. I also find that notwithstanding the fact that the learned trial Court had refused to condone delay in the filing of the objections had proceeded to consider the objections contained in application filed by the appellants under sections 30/33 of the Arbitration Act, 1944. (It was stated by the appellants in their application for condonation of delay that whatever objections which are to be raised are contained in the said application).
8. In so far as the plea of the learned counsel for the appellants that Umpire had disregarded the assertion that the delay in making of the Film was because of the delay in the payment of funds to be contributed by the respondent, is concerned, I find that the matter has been duly considered by the Umpire and he has given reasons for attributing the breach on the part of the appellants. In any case this objection pertains to merit of the award and in view of the finding recorded by the Umpire stating the reasons for the same, learned trial Court and for that matter this Court cannot sit as Court of appeal in the matter of said finding.
9. As to the contention regarding imposition of interest on the invested amount and mark-up on the loan amount, I find that there is no denial of the fact that the invested amount i.e. Rs,3.60 million was paid by the respondent to the appellants but they failed to perform their part of the contract.
Thus it is not a case of claim of damages rather it is case of recovery of sum certain admittedly paid by the respondent to the appellants. This matter had come up for consideration before the Supreme Court of Pakistan in case of Ghulam Abbas v. Trustees of the Port of Karachi (PLD 1987 SC 393). Following the earlier case of Messrs A.Z. Company v. Messrs Maula Bukhsh Muhammad Bashir (PLD 1965 SC 505). It was thus observed at page-711: - "So far as the law in this country is concerned, in the case of A.Z. Company (Supra), this Court has held that interest on the sum awarded as damages cannot be allowed for period prior to the date of award. except on grounds already mentioned which are not applicable in the present case. Even on the assumption that interest is recoverable as damages for wrongful detention of money since the claim of the appellant was disputed and required to be determined by adjudication in the arbitration proceedings, it was an unliquidated claim until the passing of the award and in any event interest could only be awarded if there were a debt or sum certain payable at a certain time, interest on a claim for damages arising out of breach of contract cannot be allowed both on principle and in law."
In the present case the respondent claimed sum certain which it advances to the appellants under he said agreement and not damages as such. The interest has been awarded w.e. f. 31 -3-1992 when the respondents were required underthe agreement to have completed the Film.
10. I therefore, find that Umpire has not acted without lawful authority while .warding the said interest on the said certain amount.
11. So far as the question of mark-up is concerned. the Umpire has found that the amount was loaned to the appellants by the respondent on their own request and in terms mutually agreed aid the Umpire has explained in the award that the said mark-up is not penal.
12. For all that has been discussed. the F.A.O. is without any force and is dismissed leaving sic parties to bear their own costs.